1. Field of the Invention
This invention relates to a method for designing the material flow and material inventory control to a production process line and, more particularly, to computer software for the design and supervision of material flow and material inventory control to a production line.
2. Background of the Invention
In a manufacturing production line, it is important that raw material is presented at the point of usage at or before the time that the material is to be used. In this case, material refers to raw materials (i.e., nuts bolts, wheels, fenders or other components or materials used on a production line) that are used in the production of a final product. The point of usage of a material is that point in the production path of a product where that material is used in the production of that product. One method that has been used to insure that material reaches its point of usage on the production line is a scheduling method.
In the scheduling method, the quantity of material delivered to the point of usage is that required to produce a batch quantity of product that is to be completed at some future time. The delivery of material is also scheduled in a batch process. The batch processing method is often necessary because factories are designed to manufacture products in a variety of functional departments and the scheduling is used to plan the manufacture of products through the facility. The basis of the schedule is a sales forecast for the product and quantities that customers are predicted to purchase. It is common, for example, for a kit of material to be assembled and delivered to the production plant floor in response to an order for an amount of product. The kit of material contains all of the material that is required to produce the ordered amount of final product.
This scheduling method results in component parts being issued or allocated to a product before that material is consumed or used. This allocation method results in limits to the flexibility of material usage. There is also an increased cost due to overhead from excessive material computer transactions and non-value added material counts.
This old methodology of manufacturing, and subsequently the methods of material management, are no longer competitive. When designing a manufacturing process, the tasks performed by individual workers and work stations and the physical flows of material and product between work stations and materials storage areas must be considered. A better design for a mixed-mode manufacturing line involves a demand flow system.
The design of a mixed-model manufacturing line, on the other hand, must be consistent with a process technology strategy that will permit making all functional variations (i.e., models) in a family of products that is produced by the manufacturing line. The wide variation in product features and functionality necessitates flexibility in the manufacturing line in order to accommodate the various process changes, customer demanded changes and material variations associated with the variety of products in the family of products. Conventional mixed-model manufacturing lines are organized into fairly autonomous grouped by either like-equipment or like-skills in order to produce various components of the products.
To produce each product, the manufacturing line for each product includes a set of processes. Traditionally, mixed-model process lines use batch processing since only a single product xe2x80x9crunxe2x80x9d is produced at any given time. The path of individual products through various work stations and departments is specified using xe2x80x9crouting sheets,xe2x80x9d which contain the operating steps and routing required for each part, and xe2x80x9cprocess flow charts,xe2x80x9d which describe the desired sequence of specific tasks (e.g., inspections, movements, and storage operations) for that product. In addition, the scheduling process of the xe2x80x9crouting sheetsxe2x80x9d also includes material requirements for each product at each process.
One problem with conventional mixed-model manufacturing lines is that the variety of products produced by the factory are forced to compete for manufacturing resources and equipment. This competition for resources manifests itself in the batch scheduling where only one product is manufactured at a time. This batch scheduling in turn results in long manufacturing latency, or lead time, for other products. Costs associated with this latency include the opportunity cost of customers unwilling or unable to tolerate the long manufacturing lead times, the costs of re-tooling a machine or work station when switching production from one product to another, and the costs of maintaining sufficient work in process (WIP) at each of the processes to permit filling anticipated product orders.
Customers who are unwilling or unable to tolerate a long manufacturing lead time will look to other sources to fill their demand. Lost customers affect the factory""s profitability as they represent lost revenue.
Retooling increases the product""s manufacturing cost. In that event, either the cost is absorbed by the factory, thereby reducing unit profit, or else the cost is passed on to the customer in the form of higher selling prices. Unless the product is unique and unavailable elsewhere, a higher selling price usually results in lower demand and, consequently, in lower revenues for that product.
Work-in-process represents a lost opportunity cost. Material and labor in WIP represents tied-up capital that cannot be recovered until processing has been completed and the finished goods (the products) are shipped to the customer.
Manufacturers have developed various manufacturing strategies which seek to mitigate some of the costs associated with mixed-model manufacturing process lines. One strategy, commonly called xe2x80x9cjust-in-timexe2x80x9d (JIT) manufacturing, teaches that just enough work is started to ensure that WIP is minimized. This strategy, however, does not alleviate the batch scheduling inefficiencies of mixed model manufacturing lines, and may result in an excess amount of finished goods inventory. The capital that was invested in WIP is, in JIT processing, invested in finished goods. Other strategies that promise to solve the problems of manufacturing processes, such as xe2x80x9ctotal market qualityxe2x80x9d (TQM) and the like, suggest changes in the way conventional mixed-model manufacturing lines are managed but do not solve the problems of conventional mixed model manufacturing lines. Accordingly, use of these various strategies has resulted in improvements to the batch-oriented scheduled processing associated with a mixed-model manufacturing line, but the fundamental problems of manufacturing latency, retooling, and unfinished and finished goods inventory remain.
Another problem with conventional mixed-model manufacturing line designs is that dissimilarity in the types of processes used to manufacture the various products introduces resource inefficiencies, such as machine and labor inefficiencies, associated with idle process lines. As discussed above, conventional mixed-model manufacturing is a batch process in which a process group or department works on only one particular product at any given time. Work orders are used to schedule and issue materials required to create the components and subassemblies of that product. These materials are batch-processed into the components and subassemblies, and then staged as WIP until the next process is ready to receive them. During the time the batch process is occurring, the WIP in upstream processes must wait until it can be scheduled into the current process, thereby tying-up capital in the upstream WIP. In addition, downstream processes may be idle while the upstream process completes the batch processing. This idle machine time, and the labor and overhead required to maintain the upstream idle process, represents an undesirable inefficiency and an additional cost to the factory. The accumulation of WIP and the frequency of idle processes is aggravated when the actual process time (the time to process a standard batch size) at each process is different.
A manufacturing design system, implemented on a computer, that designs manufacturing lines without many of these concerns is described in U.S. application Ser. No. 09/186919, xe2x80x9cSystem and Method for Designing a Mixed-Model Manufacturing Process,xe2x80x9d John R. Costanza. In the mixed-model manufacturing line, or the Demand Flow(trademark) Technology, essentially none of the inefficiencies associated with the mixed-model, batch-oriented manufacturing lines are exhibited.
In the manufacturing line, it is important that material arrives at its point-of-usage on the production path at or before the time when it is to be used. In addition, for reducing the material inventory in the manufacturing plant, it is desirable, in order to reduce inventories and storage space, that the amount of material stored at the manufacturing plant be held at a minimum.
In addition to material handling, there are issues of inventory control. The term xe2x80x9cbackflushxe2x80x9d is defined as being an inventory control process by which components or raw materials that are considered as having been consumed with production processes are automatically relieved (i.e., deducted) from the inventory records. Usually, the materials required to produce a product are deducted from the parts inventory when the product is placed on a finished goods inventory. Often, this takes a great deal of paperwork as the material is back-traced through the production process. Therefore, materials can be credited to the materials inventory much longer than is necessary, especially in production processes which have long-time finishing processes that require little in the way of materials to accomplish. It is desirable to institute an inventory management program that allows relief of inventories before the product is entered in a finished goods inventory.
The manufacturing line described above anticipates that the material required to perform each process is present at the process in time for its use. Therefore, there is a need for an efficient system of material management and for material accounting. Additionally, there is a need for a system for designing the material management and material accounting system. Additionally, there is a need for a system that manages the material accounting system while the manufacturing line is in operation.
In accordance with the present invention, a material flow design system is presented. The material flow design system, using a computer system, designs and monitors material to the production paths of a manufacturing line using a replenishment card pull sequence. In addition, product flow can be monitored through the production path using a replenishment pull sequence.
Embodiments of the material flow design system determine the size of replenishment containers (i.e., the amount of material that is stored in each replenishment container) in order to insure that material arrives as needed at the point-of-usage on the production path and that the quantity of material stored at the manufacturing plant is at a minimum.
One embodiment of the material flow design system includes determining the material requirements for the manufacturing line, defining pull sequences of material to the processes on the manufacturing line, and sizing replenishment containers for each point-of-usage in the pull sequence. The materials requirements are determined from the bill-of-materials for each product produced by the manufacturing line. The bill-of-materials includes the material required to produce the product. Pull sequences are defined such that material flows from a raw inventory storage or an independent production path through one or more points-of-usage to the production path of the manufacturing line in response to the need for that material at the production path. Sizing replenishment containers, and determination of replenishment signals, is calculated using demand-at-capacity values for material requirements at the production path and required times to replenish replinshment containers at each point-of-usage on the pull sequence.
One embodiment of the design system also identifies backflush locations on the production paths and deduct points on the material pull sequences where inventory accounting can be accomplished. In general, when material is delivered to the manufacturing plant it is credited to raw inventory accounting. Material is deducted from raw inventory accounting and credited to raw-in-process inventory accounting when it is pulled from a raw inventory storage area into the manufacturing plant. Materials have assigned deduct points (where the material is deducted from the raw-in-process inventory) based on the location of material pull in the raw-in-process area. At a backflush location, material is deducted from the raw-in-process inventory accounting and credited to a consignment accounting, a scrap accounting, or an in-process accounting depending on whether the deduct point triggers a consignment accounting, scrap accounting or inventory accounting, respectively. There may be other intermediate backflush points for transactions based on the types and length of the processing times.
These embodiments of the invention are further described below along with the following drawings.